MTN expects huge profits

MTN has told shareholders that it expects to report a significant increase in earnings when it releases its interim results this week.

The company said its earnings per share for the six months ending June 31, 2022, will rise 195% to 205% – from 1.48 rand last year to between 4.37 rand and 4.51 rand.

The main earnings per share will be between 5.42 rand and 5.81 rand, an expected increase of 40% to 50% over the R3.87 it reported in June of last year.

Earnings per share include an impairment loss primarily attributable to goodwill totaling approximately 25 cents (2021: 73 cents), an impairment loss on remeasurement of disposal groups of 52 cents (2021: 2 cents) and a net loss on disposal of Sohar Aluminum Towers 45 cents (2021). : 0 cents),” MTN stated.

The company said its headline earnings were negatively impacted by some one-time, non-operating items of about 94 cents (2021: 118 cents).

This includes hyperinflation excluding impairment (2 cents), foreign exchange losses (88 cents) and IFRS 2 fees arising from the MTN Ghana localization transaction (4 cents).

MTN notified shareholders in mid-June that it was in early discussions of Obtaining the entire issued capital of Telkom.

The company said it would buy Telkom in exchange for shares or a mix of cash and shares.

MTN shares rose sharply after the news, jumping more than 7% on the day.

However, the company is still 19% lower year-to-date tradingdown from about 172 rand per share on January 3 to 139 rand at the market close on Friday.

South Africa’s second largest mobile network had a strong start to the year, with its share price rising above R200 for the first time in nearly seven years in February 2022.

This was driven by the holding company’s debt reduction and strong performance in markets such as Nigeria, which has benefited significantly from higher oil prices.

However, MTN’s gains were eroded after the Nigeria Communications Commission announced in April that all mobile operators must restrict outgoing calls to subscribers with SIM cards not tied to a national identification number.

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